Blockchain is the latest wave of innovation that has begun redesigning industry, social and political relationships, and every other form of exchanging value. Once, this is not just a transition, it's a rapid trend already in action. As of this writing, over 40 top financial institutions and numerous different businesses across industries have begun investigating blockchain to minimize transaction costs, speed up transaction time, minimize fraud risk, and remove middleman or middleman services. Others are seeking to re-imagine existing programs and facilities and take them to a new level and create new forms of service offerings as well.
In the book we'll cover blockchain in greater detail. When you are new to blockchain, you can proceed through the chapters in the order provided or select only those important to you. This chapter discusses what blockchain is all about, how it has developed, and its importance with certain applications and use cases in today's world. To be able to look further into blockchain, it gives you an external viewpoint.
Backstory of Blockchain
One of the first known digital innovations that laid the foundation for the Internet back in the 1970s was TCP / IP (Transmission Control Protocol / Internet Protocol). Before TCP / IP, it was the era of circuit switching that involved dedicated communication between two parties. TCP / IP built its packet switching architecture that was more transparent and peer-to-peer without the need to create a separate line between parties.
By the early 1990s, when the Internet was made freely available through the World Wide Web (WWW), it was meant to be more transparent and peer-to-peer. This is because the free and decentralized TCP / IP was built on top. Once any new technology, particularly the innovative ones, enters the market, either it falls away on its own or it has such an effect that it becomes the accepted standard. Citizens responded to the WWW movement and took advantage in every way of the opportunities it had to bring. As a result, the World Wide Web was starting to form itself in a way that may not have been the exact way it was pictured. It could have been opener, more available, and peer-to-peer. In top of that, several new inventions and companies started to develop and it was what it is today- more organized. Little by little people become used to what technology provides. Whether an international transaction takes days to conclude, whether it is too expensive, or it is not accurate, people are just fine.
Let's look at the financial system more closely and its growth. There was no particular distinction between a contract and its settlement, because they were not two different bodies, beginning from the old days of the barter system to the fiat currencies. For instance, if Alice had to pay Bob $10, she would just give Bob a $10 note and the transaction would just get settled there. There was no need for a bank to debit $10 from Alice's account and add the same to Bob's account or function as a confidence mechanism to ensure Alice did not cheat Bob. Nevertheless, it was difficult to deal directly with someone who is not physically present near by. Therefore, banking systems developed with a lot more service offerings and transactions from every corner of the world were allowed. Geography was no longer a barrier with the aid of the Internet and banking was simpler than ever. In this way, not just banking: the Internet allowed several different kinds of web-based value exchange.
